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Bloomberg:
- Manufacturing in the U.S. expanded faster than anticipated in October, easing concern the economic recovery will be cut short once government aid wanes. The Institute for Supply Management’s factory index rose to 55.7, a three-year high and exceeding every estimate of the 70 economists surveyed by Bloomberg News, data from the Tempe, Arizona-based group showed today. Other reports indicated housing kept gaining after its worst recession since the 1930s. “The economic outlook is brightening,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. “Manufacturing is in the driving seat at this stage of the recovery. Housing has turned the corner.”
- Ford Motor Co.(F), the only major U.S. automaker to avoid bankruptcy, posted third-quarter net income of $997 million and its first operating profit since early 2008 on smaller discounts and higher sales. On an adjusted basis, Ford reported a quarterly pretax profit of $1.1 billion, or 26 cents a share, compared with a year-earlier loss of $3 billion, or $1.32. Ford beat the 20 cents a share adjusted loss estimated by an average of 11 analysts surveyed by Bloomberg. Chief Executive Officer Alan Mulally, who kept Ford out of Chapter 11 as General Motors Co. and Chrysler Group LLC reorganized, increased market share and collected more from each sale. The Dearborn, Michigan-based automaker posted its first consecutive quarterly net profit under Mulally today and said it expects to be “solidly profitable” in 2011. “Ford is a company that’s well into a turnaround,” said Bernie McGinn, president of McGinn Investment Management of Alexandria, Virginia, which owns about 320,000 Ford shares. “They did it by themselves and didn’t take government money. That gives people a good gut feeling and they’re being rewarded for that.”
- Human Genome Sciences Inc.’s(HGSI) experimental lupus drug Benlysta worked in a higher dose to reduce symptoms in a study. The company’s shares rose the most in more than three months. Human Genome increased $6.25, or 33 percent, to $24.94 at 10 a.m. New York time in Nasdaq Stock Market composite trading, after trading as high as $26.21.
Wall Street Journal:
- The chairwoman of the National Mediation Board has sharply criticized the federal agency's proposal to change a decades-old election rule that would make it easier for airline and railway employees to unionize, exposing a sharp rift at the agency's three-person board. In a letter sent to more than a dozen Republican senators Monday, NMB Chairwoman Elizabeth Dougherty said the process by which the proposal was drafted by her two colleagues is "flawed," and she questioned whether the agency had the authority to make such a rule change. The NMB sent a proposed change to the Federal Register on Thursday that would lower the bar for unionizing at airlines and railroad companies. It is expected to be published in the Federal Register Monday or Tuesday and be subject to a 60-day comment period before it could be implemented. Organized labor has been pushing for the change, but U.S. airlines oppose it -- including Delta Air Lines Inc. and Continental Airlines Inc., which are both preparing for large unionization votes. That sets the stage for a battle that could spill into Congress or the courts.
- Blackstone Group LP's(BX) perseverance in China is paying off as it prepares to broaden its presence in the country's private-equity scene. On Friday, Blackstone Chief Executive Stephen Schwarzman launched a domestic Chinese fund-management company that is seeking to raise five billion yuan ($732 million) from local investors.
- A consortium led by Italian energy giant Eni SpA (E) Monday signed an initial 20-year agreement with Iraq to develop the giant Zubair oilfield in southern Iraq, an Iraqi oil ministry official said. Under the terms of the deal, Eni, Italy's biggest energy company by market value, and its partners Occidental Petroleum (OXY) and Korea Gas Corp. (036460.SE) of South Korea will be paid $2 for each extra barrel of oil it extracts on top of current production at the field, but will be liable for a 35% tax on its profits. Eni has said the development of the field would require investments of about $10 billion in the first six years to raise output from the field to 1.125 million barrels a day from 195,000 barrels of oil a day now. However, Iraq's Oil Minister Hussein al-Shahristani, who was present at the signing, said Monday the field, in total and along the duration of the contract, would require an investment of $20 billion.
- Amid the jobless recovery, some landlords are showering flat-screen TVs, cash, rent cuts and other incentives on tenants to encourage them to renew their apartment leases and thus avoid the expense of filling empty units. The rise in unemployment has prompted tenants to seek roommates, move home or trade down to cheaper units. In the third quarter, the national apartment-vacancy rate hit 7.8%, a 23-year high, according to Reis Inc., which tracks vacancies and rents in the top 79 markets.
- Global semiconductor sales rose 8.2% in September from the previous month, the seventh-straight month of gains, according to the Semiconductor Industry Association, the industry continues to rebound from a sharp decline nearly a year ago. For the third quarter, semiconductor sales rose 20% from the second quarter.
CNBC:
- U.S. banks are at risk of sizable new loan losses, particularly on commercial property, and some banks may not have sufficient capital to fully cushion against losses, a Federal Reserve official said on Monday.
The Business Insider:
- 10 Cities Where Real Estate Is Surging Again.
- We had professor William Black on TechTicker this morning. A former regulator who handled the S&L resolution, Prof. Black remains appalled at how this latest round of bailouts has been handled. Case in point? CIT Group. Once again, the white knight who stepped in to save the company--the U.S. taxpayer--gets completely hosed.
Boston Globe:
Rassmussen:
Reuters:
- White House economic adviser Lawrence Summers will lead a high-level meeting on Monday to discuss the state of the economy, job creation and ways to achieve sustainable growth. A White House announcement said the meeting would take place at 2 p.m. EST (1700 GMT) and would include Cabinet officials from Treasury Secretary Timothy Geithner to Health and Human Services Secretary Kathleen Sebelius, Agriculture Secretary Tom Vilsack and Energy Secretary Steven Chu. National Security Adviser James Jones, White House climate czar Carol Browner, U.S. Trade Representative Ron Kirk and senior White House adviser Valerie Jarrett are also among those scheduled to attend.
- Shares of BlackBerry maker Research In Motion(RIMM) fell more than 6 percent on Monday after an analyst told investors to sell the stock because of mounting competition from other smartphone makers. "Simply put, there is an invasion of new phones, applications, and competition," Citi Investment Research analyst Jim Suva wrote to clients. He cut his rating to "sell" from "buy".
Financial Times:
- Walmart(WMT) has stepped up efforts to mobilize local political support for new store openings in US cities and urban areas that were last month identified as a growth priority for the retailer by Mike Duke, its chief executive. In addition to a renewed drive to open a second Supercenter store in Chicago, the retailer is also raising its political profile in Philadelphia and continuing to cultivate the ground for a potential move into New York City. Walmart has long faced political resistance to its plans in the largest US cities, largely orchestrated by the UFCW grocery workers’ union and its political allies. Eduardo Castro Wright, chief executive of Walmart’s US stores, has estimated that urban markets where the retailer is under-represented could yield billions of dollars of new sales. “We already have in our real estate program a robust plan to go after those,” he told analysts in October. The retailer has only one store inside Chicago’s city limits and none in New York or Boston. The focus on urban markets comes at a time when Walmart’s national reputation has improved, partly as a result of its strong performance during the recession. Leslie Dach, head of corporate communications, said last month that Walmart’s role in serving low-income customers during the recession had won the retailer “new respect from politicians, from economists and from the media”. The retailer’s embrace of environmental sustainability over the past four years has also improved its ethical reputation, moving up Covalence’s ethical rating of 27 global retailers from bottom in 2004 to second currently, behind Marks and Spencer. Saint Consulting, a group specializing in land-use politics, reported in January this year a drop in the number of people saying that they would oppose the opening of a new Walmart store – at 56 per cent, down from 68 per cent two years ago.
Style Underperformer:
Small-Cap Value (-1.94%)
Sector Underperformers:
Oil Tankers (-4.0%), REITs (-2.59%) and Airlines (-2.46%)
Stocks Falling on Unusual Volume:
DNR, GMXR, HXM, TSRA, ARCC, IMO, SCSC, MSA, DDS, JCP, NICE, SVVS, NTES, WATG, DDRX, RIMM, ININ, PCBK, SHPGY, ODFL, AAWW, FWRD, EEFT, PRAA, RSTI, IOSP, DEL and TXI
Stocks With Unusual Put Option Activity:
1) LDK 2) MTLQQ 3) YRCW 4) ODP 5) GTXI
Style Outperformer:
Mid-Cap Growth (+1.22%)
Sector Outperformers:
Banks (+2.04%), Hospitals (+1.78%) and Road & Rail (+1.57%)
Stocks Rising on Unusual Volume:
EAC, E, LGCY, HGSI, VRTX, AMLN, CRESY, PRGO, BABY, VSEA, LECO, DDRX, JDAS, SYNT, HRBN, BGFV, ATHN, DNDN, GLRE, USTR, IBOC, EXPE, BIIB, BGH, TRA, CTB, DEG, HAE and TXI
Stocks With Unusual Call Option Activity:
1) VRTX 2) PDCO 3) MFE 4) URBN 5) AMLN
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